Object reference not set to an instance of an object.
Brief Counsel

Appeal Court reinforces compulsory acquisition rights

19 June 2012

Download:Brief Counsel - Appeal Court reinforces compulsory acquisition rights

A PDF reader is required to read this file.
Download the free Adobe Acrobat reader here

​The Court of Appeal has reinforced the government’s rights of compulsory acquisition, even over land that is required only indirectly for a public work.

The decision will provide a degree of comfort to requiring authorities, councils and infrastructure developers.

The case

The NZTA needed to move three electricity towers as part of a programme to widen State Highway 1 near Christchurch.  After negotiations to buy land and easements to accommodate the towers failed, the Minister for Land Information issued a compulsory acquisition notice under s 23 of the Public Works Act (PWA). 

The land owner filed judicial review proceedings arguing that:

  • the Minister’s powers under the PWA allowed him to take easements only over land which was directly required for the road widening works
  • the easements were not even required indirectly for the project so the Minister was acting beyond his authority in any event, and
  • even if the Minister did have the necessary power, he had exercised it improperly because the easements were for the benefit of Transpower and Orion, rather than the NZTA.

The High Court found for the land owner.  Gendall J found that the Minister had exercised his powers for an improper purpose, “purporting to act under the PWA by reference to a Government work” when in fact, the easements were “in gross favour of, and required by the power companies.”

The Appeal Court

The Court of Appeal overturned the High Court result. The Court noted the imprecise drafting of the PWA (particularly the definitions of “Government work” and “public work”), but found the intent clear.  It held that the Minister was permitted to acquire land whether it is directly or indirectly required for a Government work. 

The Court said:

“It is not difficult to conceive of situations where land would be required indirectly for a Government work.  It seems improbable that Parliament would have denied the Minister the power to acquire land compulsorily where it could be shown that the land was required, even though indirectly.  Any such limitation would significantly reduce the PWA’s effectiveness and workability, particularly in circumstances such as the present.”1  

This finding is consistent with the High Court ruling in Kett v Minister of Land Information2, which is frequently cited in compulsory acquisition cases. 

In relation to whether the land was in fact required (either directly or indirectly), the Court defined “required” as “land whose acquisition is, viewed objectively, essential or reasonably necessary rather than in some general sense desired.”3

Applying this definition to the land in question, the Court found that it was open to the Minister to conclude that the land was reasonably necessary to allow the road widening to proceed, and accordingly was “required”.
On the third ground – that the Minister had acted improperly in exercising his power for Transpower and Orion rather than for NZTA – the Court of Appeal also found for the Minister, saying that he had acted in the public interest in “attempting to ensure a timely, orderly and comprehensive process.”4  

Again, practical considerations appeared to be front of mind for the Court:

“...there is an obvious benefit in having one party acquire the rights necessary to facilitate the relocation rather than having a number of different processes underway.  Even in the present case it would be somewhat cumbersome if the Minister had to acquire the electricity towers compulsorily from Transpower and Orion so as to extinguish their existing use rights and then Transpower and Orion had each to negotiate with the land owner concerning whatever arrangements might be necessary to enable their towers to be relocated.”

The Court left for another day the issue of the status of the works under the PWA when the easements are later transferred from the Crown to the respective lines companies – will the land interest then be required for roading purposes or for electricity transmission purposes?

Comment 

The power of the Crown to compulsorily acquire land for government works necessarily involves a balancing of private property rights against the broader public interest. Given the draconian nature of compulsory land acquisition powers it is important to both land owners and public authorities to have clarity about the scope and application of those powers. The decision here assists – and shows that the courts are looking for a practical and workable interpretation of the sometimes labyrinthine provisions of the PWA.

The PWA provisions and their integration with other legislative processes are currently being reviewed as part of the infrastructure work stream in the Phase Two reforms of the Resource Management Act.  Final decisions are expected later this year.

Thank you to Natasha Kusel and Nicky McIndoe for writing this Brief Counsel. For further information, please contact the lawyers featured.

Footnotes
  1. Minister for Land Information v Seaton [2012] NZCA 234 at [29].
  2. HC Auckland AP404/151/00, 28 June 2001.
  3. Minister for Land Information v Seaton [2012] NZCA 234 at [31].
  4. Minister for Land Information v Seaton [2012] NZCA 234 at [44].
  5. Minister for Land Information v Seaton [2012] NZCA 234 at [42].

Contacts